Penny stocks trade for five dollars or less on the major stock exchanges. Some investors love them because they are cheap, but their inexpensive nature comes with a tradeoff of high volatility. There are ways to make smart investments in penny stocks and those interested in coal mining should consider some of the coal penny stocks available.
To mitigate the risks involved in penny stock investments, some experts advise investors to limit their choices to stocks that trade between $1.50 and $5.00 per share. Of these, they should make further reductions to include only four and five star stocks with market caps between $250 million and $2 billion. Doing this research and trimming the list of prospective coal penny stocks may result in a smarter investment.
Investors may want to research International Coal, a five star stock trading at $4.40 that has been attracting investments. Some feel that the company’s metallurgical coal production is where its true profits lie. Shares in Patriot Coal Corporation move into and out of the penny stock range. In the UK market, investors should research the companies Anglo-American and Strategic Natural Resources. In late 2009, Anglo-American subsidiary Clean Coal was granted a license to do underground coal gasification in the North Sea. This area is believed to yield coal in large enough supply to meet UK demand over at least the next decade.
The coal mining industry has been subjected to increased regulatory scrutiny as of late. The Environmental Protection Agency has been conducting additional reviews of new mining permits in light of potential water pollution issues. The Presidential administration wants to limit carbon emissions and find clean energy sources. However, some analysts still predict a long-term opportunity in selling penny stocks in coal mining companies.
Penny stocks are a risky investment, to say the least, but some of them actually do hit it big. The key is to research the company to make sure that it has a strong financial background. Tracking the past stock performance also will not hurt because it will provide the investor with some type of expectation for the future.
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Coal Mining, investing, Mining Stocks
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